Global Agenda Councils
Demystifying the Arctic
Authored by the Members of the World Economic Forum Global Agenda Council
on the Arctic
Davos-Klosters, Switzerland 22-25 January
January 2014
© World Economic Forum
2014 - All rights reserved.
No part of this publication may be reproduced or
transmitted in any form or by any means, including
photocopying and recording, or by any information
storage and retrieval system.
The views expressed are those of certain participants in
the discussion and do not necessarily reflect the views
of all participants or of the World Economic Forum.
REF 140114
Contents
5 Executive Summary
7 Challenge 1: The Arctic needs
protection from environmental
damage, resolution on certain
global agreements, and new
collaborative models to secure
sustainable growth.
9 Challenge 2: The Arctic needs
investment.
11 Challenge 3: The Arctic needs
measures to better ensure human
and environmental safety in the
face of increased shipping and
offshore activity.
13 Challenge 4: The Arctic needs
science.
15 Appendix – Arctic Myths
16 Members of the Global Agenda
Council on the Arctic
17References
17Endnotes
Demystifying the Arctic
3
Executive Summary
To this day, the general public thinks of the Arctic in visions
of unspoiled ocean and landscapes, expansive ice, clean
water, unique species and aboriginal cultures – essentially,
it reminds everyone that a true wilderness still exists. In
addition to important natural resources, the Arctic provides
inspiration by maintaining its irreplaceable cultures, a pristine
environment, healthy ecosystem and ground-breaking
collaborative governance models. As such, it is a global
asset that should be maintained.
While largely true, this vision is not the complete picture.
With a population of about 4 million people and an annual
economy of roughly US$ 230 billion, the Arctic falls under
the jurisdiction of eight modern countries with a long history
of governance in the region. Development over the past
decades has included major expansions of oil and gas
activity since the 1960s. These and other facts are often
surprising for people not familiar with the area, and indeed
the Global Agenda Council on the Arctic has identified five
particularly pervasive myths about the region that need
correction (see Appendix). For example, the region’s wealth
4
Demystifying the Arctic
of natural resources is not readily available for development,
and the Arctic will not become immediately accessible
even as summer sea ice continues to retreat in response
to climate change. Moreover, the Arctic is neither a tense
area with geopolitical disputes nor a likely flashpoint for the
world’s next military conflict.
On the contrary, the region is a powerful example of
international collaboration; its countries largely conform
to standard international treaties, confer regularly at
regional forums such as the Arctic Council and use normal
diplomatic channels to resolve differences. The widely
publicized seafloor-sovereignty extensions now under
way for the Arctic Ocean, for example, are science-based
and not controversial, except possibly for the potential
overlapping claims of several Arctic states at the North Pole.
The parties involved are simply following the same United
Nations (UN) procedure used to settle continental-shelf
disputes around the globe. Some outstanding boundary
and jurisdiction issues among the Arctic states have yet to
create geopolitical friction at a level comparable to most
similar disputes in the world. Indeed, the Council’s Members
consider the region to be a leading example of international
collaboration.
The Arctic is an emerging market in a well-governed but
challenging environment, offering a host of major investment
opportunities in the coming years as well as special risks.
While its raw materials present many indisputable benefits,
the potential negative global impacts of attempting to exploit
those materials unsustainably are serious. This dichotomy
may be the driving force of strong passions around Arctic
matters in the public debate.
In this context, at least two important economic pressures
will affect ongoing development in the region:
–– Natural resources: Conventional hydrocarbons (natural
gas, condensate and oil) and metals are critical and
abundant natural resources in the Arctic. Several
large projects with considerable potential for future
development already exist, including the supply of onefifth of the world’s nickel from the Russian Arctic and one
of the world’s largest zinc mines located in the Alaskan
Arctic. Other valuable resources include fish, high-value
minerals (diamonds and rare earths) and fresh water.
–– Growing viability of seasonal shipping in Arctic
waters: Recent climate model projections reveal nearuniversal agreement that thinner, less-extensive sea
ice will make Arctic waters more accessible in summer
to lightly strengthened ships. While a highly seasonal
phenomenon, this raises prospects for plausible new
trans-Arctic shipping routes between the North Atlantic
Ocean and Bering Strait, offering substantial savings
compared to longer passages using either the Suez
or Panama Canal. Such new lanes could possibly
supplement existing global trade routes in summer,
saving fuel and cutting logistics supply-chain time, with
potential benefits for industries and consumers. Perhaps
most significantly of all, new routes would increase the
possibility of local “destinational” (bulk and cruise) marine
activity, including resource development and extraction
for global commodity markets. Cruise-ship tourism is a
growing industry in the region.
Challenge 1: The Arctic needs protection from
environmental damage, resolution on certain global
agreements, and new collaborative models to secure
sustainable growth.
Primarily external factors – from world commodity prices
to rising greenhouse gas emissions – drive long-term
changes in the Arctic. Policy and business decisions made
outside the region, at national and international levels,
will be critical for future environmental, economic and
social developments, such as progress in climate change
negotiations. Strong disparities exist among national policies
on economic development, aboriginal rights, climate
change and environmental protection. Because the region
is ecologically fragile, such inequalities heighten risks to
all stakeholders, for example if strong protections against
oil-spill risks are implemented in some but not all Arctic
countries.
While opportunities in the Arctic exist for both resource
development and shipping, numerous important challenges
must be addressed to ensure that any future plans unfold
sustainably, so that the unique and vulnerable Arctic
environment is maintained for future generations.
Challenge 2: The Arctic needs investment.
A critical deficiency and area of great strategic importance
is the development of infrastructure projects and logistical
hubs. Except for certain areas of Norway and the western
Russian Federation, the region remains vastly underserved
by transportation, port and other critical infrastructure.
For further economic growth and overall development
to occur, both public and private actors need to boost
investment on necessary projects. Increasing the Arctic’s
attractiveness for investment can be pursued in many
Demystifying the Arctic
5
ways, as in stable, transparent political governance and
judicial systems, and a consistent, clearly defined regulatory
regime. For many reasons, large industrial projects must
often be “transborder”, involving several Arctic states and
even consumer countries. While currently lacking within
the region, a framework to streamline such transborder
collaboration would greatly facilitate investment.
Challenge 4: The Arctic needs science.
Challenge 3: The Arctic needs measures to better
ensure human and environmental safety in the face of
increased shipping and offshore activity.
The extent of summer sea ice in the Arctic is decreasing
sharply, raising the likelihood of increased traffic from
moderately ice-strengthened vessels (e.g. those currently
used in the Baltic Sea) and, potentially, from ordinary
open-water ships on one of the world’s most remote
and dangerous oceans. Furthermore, for an ocean that
is arguably the most pristine on earth, serious concerns
exist about the safety of human life, property and the
environment. In particular, the prospect of common openwater ships entering the Arctic Ocean, Northern Sea
Route and Northwest Passage heightens the urgency
to establish a comprehensive regulatory framework
under the International Maritime Organization (IMO) to
ensure that adequate vessel safety standards, navigation
control systems, environmental protections and searchand-rescue capability are in place. The current lack of
quality bathymetric information, navigation control and
communication capacity must also be addressed.
6
Demystifying the Arctic
Natural resource development, sustainable economic
growth, ecosystem protection and an understanding of the
impacts of climate change in the Arctic all have one thing
in common: a pressing need for more science. Despite
intense global interest, the Arctic remains one of the world’s
least-studied environments. While a few areas have received
a relatively high level of attention and funding (e.g. Arctic
Alaska, the Greenland ice sheet, ocean-floor bathymetric
mapping to support Article 76 claims of the UN Convention
on the Law of the Sea [UNCLOS], the Barents Sea), the
vast majority of Arctic landscapes, oceans and ecosystems,
as well as the climate, have received little field study. The
lack of basic scientific understanding and datasets now
pose a challenge for both business and environmental
interests. An urgent need exists among public and private
actors for new scientific observations, including long-term
monitoring and mapping programmes, improved computer
modelling and development of new technologies, ranging
from autonomous sampling platforms to satellite observing
systems. Moreover, climate change in the Arctic affects
climate elsewhere in the northern hemisphere, meaning that
understanding the Arctic region will have a positive impact
on managing the environment in non-Arctic areas.
The Global Agenda Council on the Arctic develops these
four key challenges for sustainable Arctic development
further in this report, and proposes opportunities that
warrant greater attention and debate.
Challenge 1: The Arctic needs
protection from environmental
damage, resolution on certain
global agreements, and new
collaborative models to secure
sustainable growth.
The Arctic’s unique natural and cultural landscapes are
vulnerable to a warming climate and greater human activity.
Some influences have clearly negative effects, such as
ecosystem changes due to climate change or increased
risks from human activity such as oil spills. Others present
new opportunities, like economic empowerment of local
communities and provision of raw materials for developing
markets. However, averting serious environmental problems
in such a remote, harsh and fragile ecosystem requires
conscientious environmental and cultural stewardship, with
a strong emphasis on sustainable change. Laws, policies
and business decisions made at national, regional and
international levels will be critical for future developments in
the Arctic.
Global climate change and the Arctic
Due to several well-understood feedback loops of
environmental systems, the Arctic experiences amplified
climate change compared with the rest of the world. The
consequences, such as melting sea ice, visibly demonstrate
how global climate change profoundly affects the region.
In fact, climate change is triggering reductions in sea ice
cover in the Northern Sea Route and Northwest Passage,
which may open summertime shipping routes through the
central Arctic Ocean by mid-century. More detrimentally,
milder winters and thawing permafrost are making road
construction on ice difficult and threatening already-built
infrastructure on land. As the maritime and terrestrial
environments change, both indigenous peoples and animal
species across the Arctic are experiencing altered hunting
Demystifying the Arctic
7
patterns. The ecological outcome of continued warming
is difficult to predict, but will very likely pose challenges to
some of the world’s most iconic species. Also, the service
and value provided by the ecosystem to society is altered
but difficult to quantify.
Resolution of global, multilateral and bilateral
agreements
The Arctic is not rife with geopolitical tension, but some
issues still deserve resolution through diplomacy and
international agreements. At the global level, meaningful
international action is required to curb growth of the world’s
carbon emissions and to preserve Arctic ecosystems.
Within the region, the UNCLOS treaty provides an
orderly international process for adjudicating offshore
seafloor sovereignty extensions, and that process is still
ongoing; moreover, the United States (US) has not ratified
UNCLOS, and some legal uncertainty surrounds the
treaty’s definition of ice-covered waters. The international
status of the Northwest Passage through the Canadian
Arctic archipelago, and a small disputed triangle (about
6,250 square miles) in the Beaufort Sea of overlapping
claims between Canada and the US, remain unresolved. In
addition, Greenland (Denmark) and Canada have competing
claims over Hans Island in the Nares Strait. None of these
situations will destabilize the region, but their resolution will
further aid collaborative governance models in the region.
Protecting the Arctic in the face of development
The Russian Federation’s strategy for its Arctic zone, signed
earlier this year by President Vladimir Putin, has a clear
agenda for increasing the development of northern regions.
The theme of Canada’s Arctic Council chairmanship is
“development for the people of the North”, with a focus
on responsible Arctic resource development, safe Arctic
shipping and sustainable circumpolar communities.1
Greenland recently elected a prime minister who supports
the advancement of northern development. Although the
governments of the eight Arctic states all share an interest
in advancing the development of their northern territories,
they take divergent approaches that also vary at the
local level. Since the Arctic region is relatively small and
ecologically fragile, such divergences heighten the risks to all
stakeholders if, for example, stronger regulation of offshore
activities is implemented in some but not all Arctic states.
With increased activity, the need for better preparation for,
response to and mitigation of environmental and publicsafety threats will increase as well. As operations develop,
best practices should be shared across the region; countries
with Arctic stakes can facilitate this sharing by reinvigorating
diplomatic attempts, through the Arctic Council and/
or other bilateral and multinational means, to reconcile
differences in national policies on economic development
and environmental protection.
8
Demystifying the Arctic
The challenge is finding the right balance between
protecting the region and providing the appropriate tools to
advance economic activity. While many factors make the
Arctic a uniquely challenging environment, a crucial element
for business is predictability. An accepted set of operating
principles, adhered to by companies with Arctic operations
across all sectors and promoted by national governments,
may be a more achievable reality than formal, regionally
agreed regulation. However, it is recognized that mandatory
international regulations are being developed by the IMO for
all vessels operating in the Arctic.
Regional and local operating principles should be
established by evaluating and addressing several factors
that include (1) the use of heavy fuel oil and the impact of
black carbon from shipping and other emission-reducing
measures; (2) the discharge of ballast water, garbage and
pollutants; (3) routing measures and speed limitations; (4)
particularly ecologically sensitive areas and places of refuge;
and (5) emergency response capabilities. In addition, the
database of the International Hydrographic Organization
(IHO), with bathymetric, biometric and mapping information,
could assist national governments and experts to better plan
how the Arctic is used and to enhance safety for operations
and the environment.
Opportunities for and protection of people in the Arctic
Four million people live in the Arctic. While climate change
may offer some economic benefits in a region with relatively
few opportunities for development, it also presents
threats to cultural heritage and traditional subsistence
lifestyles. In particular, it threatens lifestyles associated
with the safe use of sea ice as a transportation platform
or with the hunting of animals that have sea ice habitats
(e.g. walrus, bearded seal, polar bear). At the same time,
many Arctic communities seek more political autonomy in
governing local affairs and greater economic participation in
development by outside companies. Global companies and
national governments need to ensure the inclusive growth
of local communities, an objective currently legislated in a
highly uneven way among northern-rim countries due to the
differing status of land-claim settlements and subsurface
mineral rights. This goes beyond revenue sharing to include
respect for local decision-making platforms, economic
aspirations and preservation of local languages and
heritage. Community-based approaches are thus a critical
part of development, in addition to environmental protection
and safety, in order to secure sustainable change in the
Arctic.
Challenge 2: The Arctic needs
investment.
Growing international demand for natural resources,
including hydrocarbons, metals and fish (all present in the
Arctic), is a leading factor in the structure of global trade
and industry. Consequently, infrastructure is a prerequisite
for sustainable development. A related challenge is energy
supply, which is often a bottleneck leading to high energy
costs in the region.
Large infrastructure investments are capital-intensive and
often require coordination or partnerships between public
and private stakeholders at national or international levels.
For many reasons, including geography, the seasons
and markets, large Arctic industrial projects must often
be transborder in scope, involving several Arctic states
and even consumer countries. Adding to project cost and
complexity, this makes investment decisions difficult. While
currently lacking in the Arctic, a framework to streamline
such transborder collaborations would greatly facilitate
investment.
The need to expand Arctic infrastructure
While some Arctic areas, notably the Barents Sea, have a
minimum level of infrastructure for their industries to operate
functionally, a pressing need for physical infrastructure
exists. This includes transportation (ports, harbours, roads,
airports and railways), energy supply (power plants, pipelines
and drilling platforms), telecommunications, buildings,
water and waste management. Specialized transportation
equipment is also a high priority, including icebreaking ships,
airships, helicopters, planes, oil-spill remediation vessels
and low-impact, land-based transportation. These types
of infrastructure, currently lacking relative to anticipated
needs, are important preconditions for sustainable Arctic
development. Additionally, Arctic infrastructure inevitably
requires greater levels of monitoring, management and
maintenance than required in southern latitudes.
Facilitating cross-border cooperation and investment
High-level coordination is needed to ensure synergy
between Arctic governments and stakeholders, and to
develop collaborative plans for new infrastructure linking
population centres, countries and proposed development
projects. A good example of cross-border cooperation
between private and public parties is the Barents 2020
Project undertaken by the Russian Federation and Norway;
it focused on offshore oil and gas developments and
protecting the people, environment and asset values of
the Barents Sea area. As for environmental protection
and sustainable development, the Arctic Council offers
an effective, consensus-driven intergovernmental forum
for promoting the common interests of its constituents in
developing the Arctic in an economically and environmentally
sustainable way.
Demystifying the Arctic
9
Effective decision-making is also needed at the bilateral
level. Such alignments provide a framework and platform
for predictable decision-making, a necessary condition for
successful projects and regional economic growth. During
its Ministerial Meeting in Kiruna, Sweden in May 2013,
the Arctic Council established a business roundtable for
fostering intra-Arctic trade and attracting foreign investment.
Non-Arctic states commonly express apprehension about a
lack of investment safeguards or guarantees, and are thus
dissuaded from making large investments. Establishing
certain domestic mechanisms to address these concerns,
together with reliable tax policies and regulations, would
greatly ease capital inflows. Clear articulation of the
procedures, requirements and timelines for project approval
are especially crucial, as most businesses cannot afford
drawn-out debates with ambiguous and unexpected
outcomes.
An Arctic investment vehicle for sustainable
development
Investment strategies of large institutional investors, such
as pension funds and sovereign wealth funds, may have
certain constraints – for example, they can only co-invest
or invest in parallel with commercial banks or multilateral
development banks. The resulting lack of Arctic investment
could be overcome by establishing a cross-border financing
institution, i.e. a Sustainable Arctic Investment Vehicle,
designed much like (and possibly in cooperation with) one
of the international development banks, for example the
European Bank for Reconstruction and Development, the
International Finance Corporation or the Nordic Investment
Bank. This institution’s mandate would be to finance
projects around the Arctic region, including cross-border
infrastructure investments. Along the same lines, dedicated
Arctic funds could help mobilize private equity in close
cooperation with the above institutions.
Improved communication and media relations
The Arctic is very different from other frontier markets
due to its low population density. In addition, many Arctic
communities see investing in industries that are invasive
and/or potentially damaging to the environment (e.g. oil
and gas, mining, shipping, commercial fishing) as disruptive
to traditional culture and subsistence such as whaling,
fishing and hunting. However, in many cases communities
support development, provided it is done sustainably and
offers clear economic returns. Such support is especially
common in Alaska, Canada and Greenland, where landclaim settlements have been concluded. Other examples
from communities like Hammerfest, Norway, show that
industrial investments boost the local economy and enable
northern inhabitants to thrive in an otherwise challenging
environment. Increased prosperity, higher education levels
and improved infrastructure are just some of the benefits
making a real impact. This nuance is seldom recognized
10
Demystifying the Arctic
outside the Arctic states, and a common misperception
is that all local (and especially indigenous) residents of
the Arctic are oppressed and opposed to commercial
development. More work is needed to communicate to the
popular media and global audiences that balanced and
integrated economic and environmental development is
possible and, when done correctly, is supported by Arctic
residents. In addition to portraying the real situation more
accurately, such recognition would also bring attention to
Arctic groups whose unsettled land claims are a detriment
to their economies, autonomy and sense of identity.
Attracting permanent talent
The Arctic suffers from a lack of people and skills to realize
large, complex industrial projects. In the long term, the
region must become an attractive place to settle, and it
will take time and require investments in liveable societies
to attract families from outside. The expansion of data,
telephone and satellite communications would contribute
to both the industrial infrastructure and the attractiveness of
the region, and help advance maritime safety and industrial
development. Higher education is an essential part of wellbeing and for creating a value-added Arctic economy. The
University of Alaska has three institutions of higher learning
in the US state. The Northern (Arctic) Federal University
in Archangel, and the universities in Tromsø, Bodø,
Luleå and Rovaniemi of the Nordic countries, are other
success stories. Many Norwegians were sceptical when
the University of Tromsø opened in 1968, but it has since
thrived, and most graduates stay in the region.
Challenge 3: The Arctic needs
measures to better ensure
human and environmental
safety in the face of increased
shipping and offshore activity.
Trends indicate that the thickness and areal extent of latesummer sea ice has declined sharply; it now covers about
40% less of the Arctic Ocean than during the late 1970s
(September measurements). This steep reduction in sea
ice has spawned abundant speculation about potential
new shipping lanes for global trade, linking the Pacific and
Atlantic Oceans through the Arctic, and offering significant
savings over longer passages using either the Suez or
Panama Canal. Nascent shipping activity has begun in
the last two years along the Northern Sea Route, with 46
transits in 2012 and 71 in 2013 reported by the Northern
Sea Route Information Office (some of the voyages between
ports in the Russian Arctic).2 The perception that sea ice is
the sole obstruction to Arctic shipping is a myth, however,
as numerous other factors influence the region’s maritime
activity. Key driving forces include the development of
Arctic natural resources and linkage of the region to global
commodity markets. Lack of quality bathymetric information,
navigation control, communication capacity and searchand-rescue capacity are also important. And, to put the
Northern Sea Route transit numbers into perspective, the
Suez Canal accommodated 17,749 and 17,225 vessels in
2012 and 2013, respectively. Put simply, it seems unlikely
that diminishing Arctic sea ice will revolutionize global
shipping in the short to medium term.
Continued sea ice reduction, however, will in all likelihood
tempt increasing numbers of ships to enter the Arctic’s
waters. The Arctic already experiences significant local
destinational ship traffic related to community resupply and
the oil and gas, mining and tourism industries. Destinational
shipping will increase with greater marine access, longer
seasonal navigation and new connections for Arctic natural
resources to global markets. Model projections of current
and future sea ice conditions show that even under the
most conservative climate change scenarios, the technical
ability of moderately ice-strengthened commercial vessels,
like those currently used in the Baltic Sea, and ordinary
open-water ships will expand in summer, with the former
probably able to cross the central Arctic Ocean by the
middle of this century. Such shorter summertime transits
could burn less fuel and thus produce lower emissions, and
Demystifying the Arctic
11
potentially create more efficient summertime supply chains
that translate to lower costs for producers and lower prices
for consumers. Furthermore, Arctic shipping routes could
become more attractive not just versus alternative shipping
lanes, but also when land routes are destabilized by thawing
permafrost or winter ice-road seasons are shortened.
The Arctic – still a dangerous ocean
Despite climate change, many dangers remain. Arctic sea
ice will refreeze in winter, creating unpredictable year-round
floes and remnants perilous to common, open-water ships.
Large seasonal and interannual variations in sea ice will
challenge development of Arctic marine-transportation
systems and create unpredictability for logistics supply
chains. Small populations and low levels of economic
development limit the amount and quality of physical
infrastructure, navigational charts and the communications
systems available. Shallow bathymetry and polar darkness
will remain challenges regardless of diminishing sea ice.
All of this raises serious concerns for the safety of people,
property and the environment linked to what is arguably
the world’s most remote, dangerous and ecologically fragile
ocean. The prospect of common open-water ships (which
comprise the vast majority of the world’s fleet) entering the
Arctic Ocean, Northern Sea Route and Northwest Passage
heightens the urgency to ensure the safety of life at sea
and the protection of the marine environment from fuel
and oil spills, invasive species and other damages. Even
with continued decrease in the thickness and extent of sea
ice, the Arctic Ocean poses a unique set of challenges for
companies and governments seeking to ensure safe and
environmentally sustainable navigation in the region.
Working towards a mandatory Polar Code
To ensure adequate vessel safety standards, a mandatory
and comprehensive regulatory framework, or Polar Code,
from the IMO is an obvious, logical start. Currently being
negotiated by the IMO to complement existing conventions,
the Polar Code addresses security of life at sea,
environmental protection and safe navigation of vessels. It
would respond to the uncommon qualities of Arctic (and
Antarctic) waters by creating better baseline operations
that would translate into enhanced reliability and safety.
Work on the Polar Code is ongoing; the goals are to have
it ratified in 2015 and implemented in 2016. A focus should
be on supporting the IMO’s Working Group in completing
its task, by securing support from the shipping industry and
acceptance and implementation by the maritime states. To
provide the most benefits, the Polar Code must ensure three
critical requirements: (1) adequate ship structural standards
for operation when in ice-covered waters; (2) special marine
safety equipment for polar operations; and (3) international
training standards and experienced ice navigators in the
pilot house.
A mandatory Polar Code, ratified and implemented, would
introduce a set of international standards for operators to
abide by, and be a major step towards decreasing risk
in one of the world’s most demanding and unpredictable
environments.
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Demystifying the Arctic
Improvements and harmonization in charting,
regulations and communications
Apart from a mandatory IMO Polar Code, numerous
other ways exist for countries, companies, international
organizations and non-governmental organizations
(NGOs) to support improved safety of life and the
environment in the Arctic Ocean. The future of the Arctic’s
development depends heavily on the creation of safe,
reliable transportation systems. The IHO, for example,
is addressing hydrography and charting issues through
the Arctic Regional Hydrographic Commission, a recently
formed subgroup. This commission is working on several
critical issues, including development of an Arctic Spatial
Data Infrastructure, and drafting terms of reference and
precautions for using navigation charts in polar waters.
Making management systems more comprehensive,
such as upgrading the quality of ship navigational aids
and addressing the current lack of proper broadband
communication infrastructure, will enable better ship-traffic
control. These measures will require strategic investments
by public-private partnerships in advance of increasing
Arctic marine traffic.
Another area for improvement relates to regulatory
differences for ships passing through coastal waters. The
Governments of the Russian Federation and Norway are
responsible for creating contingency plans to clean up any
spills from ships passing through their waters, and both
nations are already installing response depots along their
coasts. In Alaska, shipping operators are responsible for
containing, controlling and cleaning up any spill, although
contingency plans are mandated by the US Government
and the State of Alaska. Large differences in approaches
exist between what is required from domestic operators and
international shippers – situations not formally addressed by
policy. Although a Polar Code will not deal with this need,
the IMO may, through UNCLOS, require reciprocal portstate agreements that would implement better contingency
planning than currently exists. Importantly, international
shipping needs harmonized rules adopted by the IMO.
The role of the Arctic Council
For some time, the Arctic Council has recommended ways
to make Arctic shipping safer – and it will continue to do so.
Its Arctic Marine Shipping Assessment (AMSA), conducted
in 2005-2009, established a large agenda for safe shipping.
Apart from providing a comprehensive overview of Arctic
marine use, AMSA also made 17 specific recommendations
as a policy framework for Arctic states to pursue in
protecting people and the marine environment. These
recommendations were organized around three broad,
interconnected themes, namely enhancing Arctic marine
safety, protecting the region’s people and environment, and
building the Arctic marine infrastructure. The Arctic Council
produced implementation status reports in 2011 and 2013,
and a third is planned for 2015. Given the highly dynamic
nature of Arctic shipping, the Arctic Council could consider
refreshing the AMSA assessment with more recent findings
to help update its recommendations and policies, as both
physical and economic conditions continue to evolve rapidly
in the region.
Challenge 4: The Arctic needs
science.
Despite many historical expeditions and growing
international interest in the region, the Arctic remains one
of the world’s least explored and least studied areas. In
addition to known external impacts of global greenhouse
gas emissions, pollutants and development pressures,
strong natural feedback loops unique to the region flow
back into local, regional and global environments. A twoway connection between Arctic and global greenhouse gas
emissions, for example, could substantially and negatively
impact the world’s climate. Moreover, the Arctic Ocean
exports low-salinity water to the global ocean thermohaline
circulation via the Bering Strait and North Atlantic Ocean.
Better understanding of these and other impacts can only
be gained through heightened scientific study of the Arctic
region, to assess current baseline conditions, set up longterm monitoring capacities and improve the ability to model
future changes in the region and the world. Concerted
increases in scientific activity are required, to be conducted
across a spectrum of disciplines and over many years.
Different components of this huge scientific challenge are
briefly outlined as follows:
Arctic Ocean geology and oceanography
The oceanic and continental crusts underlying the Arctic
seas and continental margins are poorly mapped, and
seafloor cores and geological sampling data are few in
number. This lack of information presents major constraints
to current understanding of the age and origin of the Arctic
seafloor and its resources. Bathymetric mapping in particular
requires substantial effort and is important to modelling
ocean currents and their influence on climate, as well as
the development of safe shipping lanes. Only an estimated
8-9% of the Arctic Ocean is charted to international
navigation standards. Similarly, while the water column’s
chemistry and biodiversity provide ocean circulation and
biological productivity information, as well as key signals
of change, they rarely receive sampling surveys. Despite
its small size, the Arctic Ocean collects about 10% of the
world’s freshwater river discharge, dominated especially by
the major north-flowing rivers of the Russian Federation.
These rivers transport large volumes of freshwater run-off
and waterborne contaminants, but they and their associated
coastal zones receive only light scientific study.
Demystifying the Arctic
13
The shrinking Arctic cryosphere (sea ice, permafrost
and glaciers)
The decreasing areal extent and thickness of its seasonal
sea ice cover indicates that the Arctic is undergoing
amplified climate warming at a faster rate than the global
average. Satellite and ship observations of sea ice extent,
thickness, drift, distribution and physical character are
essential to understand these trends, as well as oceanice-atmosphere interactions, net primary productivity and
ocean stratification. Improved long-term observations and
modelling of sea ice processes and trends is needed for a
wide range of topics, including marine ecosystem health,
ocean acidification, climate feedbacks, planetary energy
balance and marine accessibility. On land, permafrost soils
thaw and trigger ground slumping and damage to buildings,
pipelines and other built infrastructure, while potentially
releasing vast quantities of carbon dioxide and methane
greenhouse gases. The Greenland ice sheet’s falling ice
volumes and the abundant small glaciers of the Arctic are
prime drivers of sea level rise. Better understanding and
modelling of these phenomena require new satellite, field
and instrument observations, together with basic theoretical
research on ice-sheet sliding geophysics and permafrost
stability.
Atmospheric science
The Arctic atmosphere influences weather systems not only
locally but over the rest of the world. Adequate monitoring
and forecasting of regional weather systems are crucial for
both scientific and societal purposes, from tracking climate
change trends to marine operations and search and rescue.
Wind-transported contaminants are carried long distances
into the Arctic, with known negative effects on ecosystems
and public health, and enhancement of regional warming
(e.g. from deposition of black carbon which reduces surface
reflectivity). In addition, earlier onset of the spring thaw is
increasing toxic load due to earlier release of deposited
contaminants. To understand these problems, continuation
and expansion of long-term meteorological records from
existing and larger observation networks are essential,
together with development of new, lower-cost technologies
such as wireless instrument constellations, unmanned aerial
vehicles and autonomous drifting platforms.
Arctic ecosystems
Additional life-science studies are needed for Arctic
marine and terrestrial ecosystems, as well as public safety
and health. Scientists have now confirmed that climate
change is creating significant changes and threats to Arctic
ecosystems, including shifts in the range of species, loss of
wetlands, destruction of marine food webs and dangerous
ice conditions. An urgent need exists to understand
how climate change and development pressures impact
Arctic species, on both a regional and global scale
(e.g. migratory bird populations). The current and likely
impacts of increased human activity in the region must
also be examined, including disruptions to migration and/
or breeding behaviour, and ecosystem sensitivity to oil
spills. Such knowledge is imperative if attempts are made
to develop Arctic resources in a responsible, sustainable
manner.
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Demystifying the Arctic
Arctic natural resources
In addition to assessing environmental risk, much work is
needed to map and quantify Arctic natural resource stocks.
Basic research on the extent, viability and environmental
sensitivity of the region’s natural resources is lacking,
particularly in the marine and offshore environment. Metals,
hydrocarbons, fish and ecotourism are key opportunities
for possible development, especially over the long term as
global demand for these assets continues to rise. The extent
and volume of offshore methane hydrate deposits are poorly
mapped but known to be vast, representing both a potential
long-term greenhouse gas threat and possible fossil fuel
of the future. On land, more work is needed to assess the
distribution and quality of valuable minerals, especially
metals.
Applied science and engineering
Of the many opportunities for applied science and
engineering, technological advances linked to mapping,
remote data acquisition, energy production, safe shipping,
search and rescue, sustainable fisheries and resource
development are prime areas for growth. Particularly
pressing is the need for new, innovative approaches for
oil-spill response and remediation in ice-covered waters.
Applied research in communications, transportation and
logistics is critical to future activity in the Arctic. Fundamental
scientific research will also aid these efforts, by obtaining
key datasets and knowledge with cross-disciplinary, crosssector, scientific, business and/or governmental relevance,
and disseminating them to a global audience.
These components form just a partial listing of the many
ways in which the Arctic needs science. Each of these
component topics is deeply important to our understanding
of both the region and the broader impacts and implications
for the world. Baseline assessments of Arctic geology,
oceanography, cryosphere, atmosphere, ecosystems
and natural resources, together with development of new
technologies, applied science and engineering, are urgently
required. Such baseline studies will need substantial and
cooperative commitments from governments, multinational
companies, international organizations and NGOs, such
as the International Arctic Science Committee, a nongovernmental forum that includes scientific bodies from the
Arctic states and thirteen non-Arctic states. Furthermore,
the Arctic’s need for science will not end there; indeed, the
dramatic environmental and development changes now
under way in the region make it a key laboratory for the
planet. Sustained support of measurement programmes,
model development, technology and the science
communities will be crucial for understanding the rapidly
transforming Arctic.
Appendix - Arctic Myths
The Global Agenda Council on the Arctic has highlighted five
particularly pervasive myths about the region:
Myth No. 4: The Arctic is tense with geopolitical
disputes and is the next flashpoint for conflict.
Myth No. 1: The Arctic is an uninhabited, unclaimed
frontier with no regulation or governance.
Fact: The region is a powerful example of international
collaboration, with the Arctic countries largely conforming
to standard international treaties (e.g. UNCLOS), regional
forums (e.g. the Arctic Council) and regular diplomatic
channels to resolve their differences. The widely publicized
sovereignty-extension petitions now under way for the Arctic
Ocean seafloor, for example, are science-based and not
particularly controversial, with the relevant parties following
the same UN procedure used to settle other continental
shelf disputes around the globe.
Fact: With a population of 4 million people and an annual
economy of roughly US$ 230 billion, the region is under
the jurisdiction of eight countries (the Russian Federation,
Finland, Norway, Sweden, Iceland, Greenland/Denmark,
Canada and the US), with few territorial border disputes
among them. Even offshore in the Arctic Ocean, most
coastal waters fall within existing Exclusive Economic Zones,
with further seafloor sovereignty extensions pending or likely
under Article 76 of UNCLOS. In Canada, Greenland and the
US, local control by aboriginal communities and regional
business corporations can be substantial. In short, the
Arctic is neither an unclaimed, contested region nor a closed
military zone; it is governed under similar national structures
and international frameworks to those in other areas of the
world.
Myth No. 2: The region’s wealth of natural resources is
readily available for development.
Fact: Many technological, infrastructural, economic
and environmental challenges impede natural resource
development in the Arctic. Extracting resources is never
a simple operation in polar environments, and resource
development will require high levels of investment, including
development of specialized technologies. The region is
not homogenous with regard to development potential;
strong distinctions exist between onshore and offshore
environments, and between different regions and countries
with regard to existing levels of infrastructure, population,
environmental sensitivity and accessibility.
Myth No. 5: Climate changes in the Arctic are solely of
local and regional importance.
Fact: The effects of global climate change felt by the
Arctic have globally relevant repercussions, with numerous
impacts flowing back to the rest of the world. These
include faster sea level rise owing to greater ice loss from
the Greenland ice sheet; altered weather patterns due to
jet stream perturbation; altered planetary energy balance
resulting from lower light-reflectivity of formerly snow- and
ice-covered surfaces; increasing greenhouse gas emissions
from thawing permafrost soils and methane hydrates; and
the psychological loss of globally iconic species like the
polar bear. Within the Arctic countries (especially Canada,
the Russian Federation and the US), reduced winter-road
access over frozen water and ground presents non-trivial
socio-economic costs to Arctic populations, transportation
networks and global commodity markets.
Myth No. 3: The Arctic will become immediately
accessible as sea ice continues to disappear.
Fact: The opposite is true on land, owing to shorter winter
ice-road seasons and destabilized ground due to thawing
permafrost. Even in the Arctic Ocean, sea ice is not the sole
obstacle to shipping and maritime structures such as drilling
platforms. Other challenges include polar darkness, poor
charts, lack of critical infrastructure and navigation control
systems, low search-and-rescue capability, high insurance/
escort costs and other non-climatic factors. The related
myth that climate change will create an ice-free Arctic
Ocean year-round is also false, as sea ice will always reform during winter, and ice properties and coverage will vary
greatly within the region.
Demystifying the Arctic
15
Members of the Global Agenda Council on the Arctic
Chair
Per-Ola Karlsson, Senior Vice-President, Booz & Company
Vice-Chair
Artem Volynets, Chief Executive Officer, Amur Capital Group
Vice-Chair
Gustaf Lind, Ambassador of Sweden for the Arctic
Lawson Brigham, Distinguished Professor of Geography and Arctic Policy, University of Alaska, Fairbanks
Cai Meijiang, Director, Safety and Technology Superintendent Division , China Ocean Shipping Group Co. (COSCO)
Michael Daly, Executive Vice-President, Exploration, BP
Vladimir V. Golitsyn, Judge, International Tribunal for the Law of the Sea
Guo Peiqing, Professor, Ocean University of China
Aleqa Hammond, Prime Minister of Greenland
Rúni M. Hansen, Vice-President, Statoil
Huang Huikang, Director-General, Department of Treaty and Law, Ministry of Foreign Affairs of the People’s Republic of
China
Amina C. Mohamed, Secretary of Foreign Affairs, Ministry of Foreign Affairs of Kenya
Laurence C. Smith, Professor and Chair, Department of Geography, University of California, Los Angeles (UCLA)
Mead Treadwell, Lieutenant Governor of Alaska
Felix H. Tschudi, Chairman of the Board and Owner, Tschudi Shipping Company
Jan-Gunnar Winther, Director, Norwegian Polar Institute
Council Manager
Ethan Huntington, Senior Associate, Global Agenda Councils, World Economic Forum
Forum Lead
Martina Gmur, Senior Director, Head of the Network of Global Agenda Councils, World Economic Forum
16
Demystifying the Arctic
References
Endnotes
Arctic Council, April 2009. Arctic Marine Shipping
Assessment 2009 Report, http://www.arctic.noaa.gov/
detect/documents/AMSA_2009_Report_2nd_print.pdf.
1 See http://www.international.gc.ca/arctic-arctique/
chairmanship-presidence.aspx?lang=eng
Aspen Institute, 2011. The Shared Future: A Report of the
Aspen Institute Commission on Arctic Climate Change,
http://www.aspeninstitute.org/sites/default/files/content/
docs/pubs/Aspen_Climate_Change_Report_2011.pdf.
2 See http://www.arctic-lio.com/
Brigham, L. “Think Again: The Arctic”. Foreign Policy, April
2011, http://www.foreignpolicy.com/articles/2010/08/16/
think_again_the_arctic#sthash.oSwiql5i.dpbs.
Brigham, L. “Marine Protection in the Arctic Cannot
Wait”. Nature, October 2011, http://www.nature.com/
news/2011/111012/full/478157a.html.
Commonwealth North, May 2009. Why the Arctic Matters:
America’s Responsibilities as an Arctic Nation, http://www.
commonwealthnorth.org/documents_cwnorth/Why%20
Arctic%20Matters%20Final%205-22-091.pdf.
Emmerson, C., Lahn, G. Arctic Opening: Opportunity
and Risk in the High North, April 2012, http://www.
chathamhouse.org/publications/papers/view/182839.
Hansen, R.M. “A Stepwise Approach to the Arctic”.
Tvergastein: The Opening of the Arctic, November 2012,
http://issuu.com/tvergasteinjournal/docs/tvergastein_
second_issue_web/35.
Smith, L.C., Stephenson, S.R. “New Trans-Arctic Shipping
Routes Navigable by Midcentury”. Proceedings of the
National Academy of Sciences of the United States of
America (PNAS), March 2013, Vol. 110, No. 13, http://www.
pnas.org/content/110/13/E1191.full.pdf+html.
White House, May 2013. National Strategy for the Arctic
Region, http://www.whitehouse.gov/sites/default/files/docs/
nat_arctic_strategy.pdf.
Demystifying the Arctic
17
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